Phy-gital Roundtable: Breakfast Roundup from Germany and Netherlands

02 May '15 | Debjyoti Paul

German Shoppers: Meet Them in the Fast Lane to Phy-gital

15 January '15 | Ralf Reich

Shoppers Will Share Personal Information (But They Don’t Want to be “Friends”)

15 January '15 | Anil Venkat

Modernize or Perish: Property and Casualty Insurers and IT Solutions

14 January '15 | Manesh Rajendran

Benelux Reaches the Phy-gital Tipping Point: Omnichannel Readiness is Crucial

13 January '15 | Anil Gandharve

The New Omnichannel Dynamic: Finding Core Principles Across Industries

13 January '15 | Debjyoti Paul

Technology does not disrupt business – CIO day 2014 Roundup

02 December '14 | Anshuman Singh

Apple Pay – The Best Is Yet To Come

02 December '14 | Indy Sawhney

Digital transformation is a business transformation enabled by technology

01 December '14 | Amit Varma

3 Stages of FATCA Testing and Quality Assurance

06 October '14 | Raman Suprajarama

3 Reasons why Apple Pay could dominate the payments space

18 September '14 | Gaurav Johri

Beacon of Hope: Serving Growth and Customer Satisfaction

05 August '14 | Debjyoti Paul

The Dos and Don’ts of Emerging Technologies Like iBeacon

30 July '14 | Debjyoti Paul

What You Sold Us On – eCommerce Award Finalist Selections

17 July '14 | Anshuman Singh

3 Steps to Getting Started with Microsoft Azure Cloud Services

04 June '14 | Koushik Ramani

8 Steps to Building a Successful Self Service Portal

03 June '14 | Giridhar LV

Innovation outsourced – a myth or a mirage or a truth staring at us?

13 January '14 | Ramesh Hosahalli

What does a mobile user want?

03 January '14 | Gopikrishna Aravindan

Blockchain: Four most compelling use cases for insurance

Posted on: 29 September '16

The transformation opportunity with the emergence of Blockchain technology is vast as it has the proficiency to reduce the turnaround time significantly. Within insurance, Blockchain finds its use from sales through policy services by digitally storing and verifying customer records. With the smart contract feature, policy services can be automated, which is sure to reduce the administration and claim processing costs and increase transparency in the system through fraud detection. Secured record-storing is a distinct feature of Blockchain which is highly advantageous to the industry which incurs heavy losses due to cyber security breaches.

Customer Identity:

A consortium of insurers, KYC databases and notary networks can verify the identity of its customers and store it in a shared ledger. Any new customer coming to the network will submit his identity proof and the notary will be able to validate the data by comparing it with the government databases which will be executed outside the network. The verified data is now available for all the network participants.

Data once digitally stored and verified can be used by multiple entities within the Blockchain, of course, with the consent of the customer. This will reduce the burden on the customer of submitting KYC documents multiple times, thus enhancing the customer experience.

Smart Underwriting:

Smart contract-enabled underwriting process can be executed by the insurer to fetch customer data from third party systems. As soon as a customer is registered, based on the opted policy, the relevant data is fetched from the third party databases; for instance, DMV database in case of consumer auto insurance. The data is used by the underwriter to finalize the premium amount and finalize the terms of the new policy for different lines of business. Once settled, the policy details are incorporated in a smart contract which will self-execute when a claim has to be processed.

Blockchain eliminates the extended document submission and third party verification process, which in turn accelerates the underwriting process as well as reduces cost.

Fraud Management and Auto Initiation of Claims:

Insurers can automate the claim process by integrating with third party vendors and manage fraudulent claims by forming a consortium network with insurers. Any claim raised against an event is shared in the network and verified by the participating insurers to identify fraudulent multiple/duplicate claims.

A smart contract-enabled platform, integrated with Blockchain, can be leveraged for process automation. When a customer opts for a service from a third party vendor who is part of the Blockchain network, the smart contract is triggered with the event details. The smart contract executes policy conditions with the claim process and shares a brief report with claims administration for final settlement.

Blockchain brings-in transparency by identifying fraudulent duplicate claims and makes the claim process hassle-free for both, the insurer and the insured.

Audit or Regulatory Benefits:

A Blockchain network where regulators or auditors are also participants can have an accurate picture of the company’s accounts. Organizations can have private Blockchain networks within the firm where different departments are the participants and the data is shared with an auditor who is also a participant. This could definitely be useful during audits – both internal and external, especially financial audits.

Blockchain system allows multiple separate internal users access the data, while giving none of them the authority to reset or roll it back – that’s an excellent property for an audit logging system.

Conclusion

The insurance industry is in a very nascent stage in terms of adopting Blockchain technology. A few insures are investing in research and building PoCs. Allianz has tied up with an insure-tech startup to implement the technology in catastrophe bonds; Lloyd has implemented a Blockchain solution for sharing economy. While challenges and uncertainties remain, the advantages that Blockchain has to offer is sure to encourage insurers to adopt it.

Leverage Machine Learning Use Case Infographic